Metered Access

Crain's Detroit Business is a metered site. Print and digital subscribers have unlimited access to stories, but registered users are limited to eight stories every 30 days. After viewing three metered stories, you'll be asked to register or log in. After eight more stories in 30 days, you'll be asked to subscribe.

Biz improvement zones: A concept that's picking up

Photo by ANTHONY BARCHOCK
Restoring streetlights has been job No. 1 for the Southwest Detroit Business Association.

Getting in the zone

What: The Downtown Detroit Partnership is holding information sessions about the DDP-led Business Improvement Zone. The BIZ would collect an assessment from property owners to pay for things like cleanup, landscaping and safety ambassadors.

D:Hive also will host a seminar for small-business owners, but that date has not been set. For more information, visit downtowndetroitbiz.com.

Let there be (street) light.

This spring, the streetlights along West Vernor Highway will finally be repaired.

For seven years, the Southwest Detroit Business Association has been working to relight the 2.3-mile stretch of Vernor between Clark and Patton parks. It raised $6.4 million for the project and is awaiting the final signature on the contract so that construction can begin in April.

"This is our largest-ever infrastructure undertaking in the history of the organization," said Theresa Zajac, vice president of the SDBA. "It couldn't happen soon enough. Every year, every month, our small businesses are like, 'When is it going to start?'"

DIY cleanup

The seven-year saga to bring the lights back to Vernor started in 2007, when the 371 commercial property owners along West Vernor, between Woodmere and Clark streets, formed the state's first business improvement district.

These property owners realized that by pooling their money they could clean up the entire street, removing graffiti, picking up trash and sweeping the sidewalks in the heavily immigrant enclave. So they voted to tax themselves $155,000 per year and hired the SDBA to administer the improvement district.

That made them just one of thousands of such groups across the country, but the first in Michigan and still the only business improvement district in the city of Detroit.

Despite the fact that these types of districts have been popular for four decades, Detroit has been slow to embrace the concept. BIDs have been proven to make a difference, according to researchers at the Furman Center for Real Estate & Urban Policy at New York University.

This year, though, the West Vernor BID might lose its title as the city's only such district: The Downtown Detroit Partnership is trying to develop a similar program.

Last week, the DDP announced that it was circulating petitions to commercial property owners in downtown proper — the area surrounded by the three freeways and the Detroit River — in hopes of creating a business improvement zone (BIZ) to handle trash pickup and beautification efforts as well as put safety ambassadors on the street.

Currently, the DDP handles many of those tasks, begging for money from the area's large corporate citizens, such as Blue Cross Blue Shield of Michigan, Compuware Corp. and Quicken Loans Inc.

Dave Blaszkiewicz, president and CEO of the DDP

"These services have been paid for by the generosity of a few businesses and organizations, and now it's time to expand," said Dave Blaszkiewicz, president and CEO of the DDP. "We want to bring consistency across the entire district and add some new bells and whistles."

If formed, the downtown BIZ would be the big daddy to the West Vernor's scrappy BID.

For one, the downtown zone has a proposed $4 million annual budget raised from 253 property owners; the West Vernor district, by comparison, has a $155,000 annual budget spread across 371 property owners.

The West Vernor BID stretches 2.3 miles along a narrow strip of road populated by bakeries, taquerias, coneys, zapaterias, boutiques and other small businesses. The downtown zone would cover just one square mile populated by the city's main economic drivers.

To make the downtown zone real, the DDP needs the vote of about 60 percent of the property owners — excluding nontaxable properties, such as those owned by nonprofit groups and the government. Owner-occupied residential buildings are also excluded, though large apartment buildings are included. The formula is weighted so that larger properties have more of a vote, so a small number of large property owners could sway the outcome.

How much a property owner would pay is based on floor space (60 percent) and assessed value of the property (40 percent), said Eric Wilson, planning and development manager for the DDP.

With that formula, the 30 largest downtown property owners would pay more than 75 percent of the expected annual budget; more than one-third would pay less than $1,000 per year.

Lighting the way

Items like streetlights won't be a prime worry of the downtown business owners, however. Those are kept on through the city's Department of Public Lighting.

But over in the southwest, the lights have been job No. 1. Their absence impacts the success — or failure — of local businesses.

Owners told the SDBA that entire sections of the street were pools of darkness, forcing them to close at dusk because it wasn't safe for their customers.

"This is a Latino neighborhood, and one of the things about Latino families is they often shop as a family," Zajac said. "They all go shopping when dad comes home. So if you don't have lights at night, you lose customers. And they didn't have any lights."

Kathy Wendler, president of the SDBA

But when Kathy Wendler, president of the SDBA, began looking into the issue, she discovered that Vernor was not on the city's list of streets to repair. There was no money for the project. So the SDBA approached the Michigan Department of Transportation for a grant. MDOT agreed and pledged half of the project's cost, or $3.4 million.

"The West Vernor business district is one of the most viable shopping corridors in the city," said Rob Morosi, communication specialist for MDOT. "This project will improve pedestrian accessibility and safety for a district where business owners continually reinvest in their community and the storefronts are full."

That helped persuade other donors to join in. The city of Detroit eventually put up $1 million, as did the Southeast Michigan Council of Governments. The Kresge Foundation added $500,000 to the pot, and the W.K. Kellogg Foundation gave $250,000. J.P. Morgan Chase & Co. added another $200,000. The Community Foundation for Southeast Michigan delivered $60,000, while Detroit LISC gave $50,000. Still, SDBA must raise another $400,000 to meet its goal.

Regardless, construction will go on, with the anticipated break-ground date of early April.

That's good news for small businesses in the area such as Aranda's Tires, which has three locations in southwest Detroit. The Lopez family has owned the business since 1987, specializing in tires and tricked-out rims as well as alignments, brakes and more. They keep a security guard on round the clock, but they see the streetlights as a huge advantage for the neighborhood.

"The big thing is vandalism," said Fernando Lopez, the shop's manager. "The more light, the less vandalism. The more light, the more safety."

The new infrastructure won't just be changed light bulbs. New poles will be installed with LED lights. Sidewalks will be repaired. Underground wiring and transformers will be replaced. Landscaping will be upgraded. And most importantly for theft deterrence, there is no copper to be found.

"There is no copper," said Zajac. "There's nothing to strip."

Street smarts

The timing on the lights is fortuitous for the southwest association because state law requires the property owners to reauthorize the district this September. Construction on the lights starts in April and is scheduled to wrap up in November.

Wendler is positive about the future of the West Vernor & Springwells Business Improvement District, but she still knows she has to remind the people of the organization's value. Last year, it hauled 500,000 gallons of trash from trash cans and another 36,000 gallons from the street. It removed 1,257 instances of graffiti, swept 644 miles of sidewalk and mowed 60 miles of grass.

The campaign to renew the BID is heading into full swing just as the downtown group is pushing through to an anticipated vote by property owners in April.

Anything could happen, but both groups are optimistic about their chances. Blaszkiewicz has a good sense of the odds: He saw a similar proposal go sideways in 2003 when a few of downtown's large property owners balked.

But to his mind, a decade has made all the difference.

"We had 80 percent vacancy then," he said. "Think about what property owners were facing in 2003 ... it's very different than today. Instead of catching them on the downswing, we are catching it on the upswing. And there is greater cooperation among the big companies."

BCBSM is one of those cooperating companies. It's standing behind the business improvement zone as a way to continue downtown's evolution.

"The efforts to continue the momentum of the great things happening in Detroit and the downtown area will be supported by this effort," said Tricia Keith, senior vice president, corporate secretary and services for BCBSM. "Providing a clean, safe and inviting downtown is the overall goal, and the BIZ is a key tool to help enable that."

But first, there are the steps toward government approval. The downtown proposal has to get enough signatures to move forward to a public hearing and review by the Detroit City Council and Emergency Manager Kevyn Orr.

After that, the issue would go to a vote of the eligible property owners — most likely by April.

That same month, about three miles away, the Vernor streetlights will start to go back on.